“I had the office across the hall from our Utilities analyst in my buyside, long-only days and he had zero weight to Enron. Back then, he was worried about getting fired.”

He continues, “The fact is you can get squeezed really hard on a short and the company can still blow up. The thing that’s different about Tesla is they’re telling you they’re losing a ton of money every quarter.”

“Nobody can sell a $1 for $0.75 like Tesla.”

2. CAR MAKER TESLA IS NOT GOOD AT MAKING CARS

This chart show Model 3 production tracked using registered vehicle identification numbers. “Production was supposed to be an exponential ramp. But this is cumulative production. They are supposed to be making 5,000 to 10,000 Model 3’s per week. They’ve made 5,000 to 10,000 since November.”

“They’re trying to sell a mass production car. But they’re really bad at that and they’ve bet their life on it. This was a prediction we made in June 2017, that they wouldn’t be able to mass produce the Model 3. And they haven’t.”

3. HERE COMES THE COMPETITION…!

You’ve probably heard of Jaguar’s first all-electric car, the iPace. The vehicle will become available in the U.S. in the back half of 2018.

Later this year, Audi plans to release its all-electric e-tron crossover in the U.S. in the first quarter of 2019.

Meanwhile, the Porsche Mission E all-electric is slated to hit the U.S. market later this year or early next.

Yea, Tesla better watch out.

“Competitors are showing up,” Van Sciver says.

“They have a 5 to 6-year development cycle versus Tesla, which has been trying to cram the development cycle into 2 years.” What year was the Model S launched? Late 2012 to 2013. Now, 5-years later, the big car manufacturers are finally starting to produce Model S competitor vehicles.

It gets worse.

“By the time we get to 2021-2022 you’re going to see a huge number of Model 3 competitors. Why? Because that’s 5 to 6 years after the Model 3 got 300,000 pre-orders,” Van Sciver says.

In other words, Van Sciver says, “Tesla had the market to themselves for years and now they’re facing high-quality competitors with marketing budgets? They’re going to crush Tesla.”

Van Sciver discusses a number of additional reasons why Tesla is a great short idea (from expiring electric car tax credits to the slow slide in the brand’s manufacturing quality).

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